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Recent RBI policies to help banks stay at equilibrium  Kamath


SUBRATA PANDA   AWL  KUMARI          ness while lowering banks  costs                                         bankers said  will increase         omy that has been driven by for-     on which we will grow  
Mumbai  9 October                    These include a nod for banks to    j10 FINANCIAL CHAIRMAN               demand for bank funding from        eign capital   Foreign capital          Explaining how capital is flow- 
                                     fund acquisitions of Indian non-    ALSO HIGHLIGHTED THAT                the corporate sector  which has     comes in through three ways  One     ing in  Kamath said highway pro- 
The recent policies that have been   financial sector companies          INDIA IS NOT AN ECONOMY              been moving away from bank          is through the capital markets as    jects and green power companies 
announced by the Reserve Bank        upgraded ceilings for loans         THAT HAS BEEN DRIVEN BY              funding towards capital markets     an investment  through foreign       are now able to raise funds 
of India  RBI  will allow banks to   against securities and IPO financ-  FOREIGN CAPITAL                      and overseas borrowings             direct investment  FDI   and         through infrastructure invest- 
fully use its capital  funding pro-  ing  and tweaks to risk weights on                                          The RBI has also proposed to     through long-term funding in for-    ment trusts   So  we are seeing 
file to keep business at an equilib- home loans                          India Inc was the removal of the     remove the regulatory ceiling on    eign currencies  But we are some-    corporates going to the corporate 
rium level  which otherwise was         Indian banks will now be         Zi 0 000 crore loan ceiling for a    lending against listed debt secur-  thing interesting  Instead of        bond market  rather than the 
getting skewed towards retail        allowed to fund acquisitions of     specific borrower by the banking     ities and enhance limits for lend-  foreign capital coming in  we are    bank funding market  Infrastruc- 
said K V Kamath  chairman  Jio       non-financial entities and finance  system  although bank-specific       ing by banks against shares from    seeing global companies now list-    ture companies  which till three 
Financial Services                   land acquisition by special pur-    restrictions continue  Loans by a    Z20 lakh to Zi crore  and for IPO   ing in India  I have not seen        years back were going to the banks 
   The RBI last week announced       pose vehicles  SPVs   These were a  bank are capped at 20 per cent of    financing from do lakh to t25       tonnes of foreign capital come in    for funding  are now tapping the 
22 measures aimed at boosting        long-standing demand of the         its net worth to a particular bor-   lakh per person                     over my career of 55 years           bond market   he said  adding 
credit flows to the real economy     lenders  Another significant        rower and 25 per cent to a group        Separately  Kamath also high-    Kamath said  adding   Foreign        that a diversification of funds is 
and promoting ease of doing busi-    measure to bolster credit flows to     These measures  experts and       lighted that India is not an econ-  capital will not be the foundation   taking place
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